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2023-06-30-accounts

Company Number 5787972

HEALTHCARE FINANCIAL MANAGEMENT ASSOCIATION

Trustees’ Report and Financial Statements

For the year ending 30 June 2023

CONTENTS

HFMA Report 2022 – 2023

SENIOR EXECUTIVESANDBOARDOFTRUSTEES 2
PRESIDENT’S AND CHIEF EXECUTIVE’S REPORT 3
TRUSTEES REPORT 4-10
STATEMENTSOFFINANCIALACTIVITIES 11
STATEMENTS OF FINANCIAL POSITION 12
CONSOLIDATED STATEMENT OF CASH FLOWS 13
ACCOUNTSNOTES 14-29
INDEPENDENT AUDITOR’SREPORT 30-32

HFMA ANNUAL REPORT 2022 – 2023 1 Company Number: 5787972

SENIOR EXECUTIVES AND BOARD OF TRUSTEES

Board of Trustees and Directors

HFMA Senior Executive Team

PRESIDENT

2022/23: Lee Bond 2021/22: Owen Harkin 2020/21: Caroline Clarke

VICE PRESIDENTS

2022/23: Claire Wilson 2022/23: Lee Outhwaite 2021/22: Lee Bond 2021/22: Claire Wilson 2020/21: Owen Harkin 2020/21: Lee Bond

CHIEF EXECUTIVE / SECRETARY

Mark Knight

DEPUTY CHIEF EXECUTIVE & DIRECTOR OF FINANCE Ian Turner

DIRECTOR OF POLICY AND RESEARCH Emma Knowles

IMMEDIATE PAST PRESIDENT

2022/23: Owen Harkin 2021/22: Caroline Clarke 2020/21: Caroline Clarke

CHAIR OF AUDIT AND FINANCE COMMITTEE

Simon Crowther

ALL TRUSTEES AND DIRECTORS

Sanjay Agrawal Lee Bond Nicci Briggs (appointed 8 December 2022) David Chandler Simon Crowther Caroline Clarke Maureen Edwards (resigned 8 December 2022) Alex Gild (resigned 8 December 2022) Kavita Gnanaolivu Bill Gregory Owen Harkin Kim Li Richard McCallum Lee Outhwaite Peter Ridley Dawn Scrafield Wendy Thompson (appointed 8 December 2022) Claire Wilson

Advisors

BANKER

Registered Charity Name and Registered Office

Healthcare Financial Management Association (HFMA) is a registered charity in England and Wales, no 1114463 and Scotland, no SCO41994. HFMA is also a limited company registered in England and Wales, no 5787972.

Registered office: 110 Rochester Row, Victoria, London, SW1P 1JP Tel: 0117 929 4789 Fax: 0117 929 4844 Email: info@hfma.org.uk Web: www.hfma.org.uk

National Westminster Bank plc Chester Branch, 33 Eastgate Street, Chester, CH1 1LG

SOLICITOR

Bevan Brittan LLP Kings Orchard, 1 Queen Street, Bristol, BS2 0HQ

AUDITOR

RSM UK Audit LLP Chartered Accountants Second Floor, 1 The Square, Temple Quay, Bristol, BS1 6DG

HFMA ANNUAL REPORT 2022 – 2023 2 Company Number: 5787972

REPORT OF THE PRESIDENT AND CHIEF EXECUTIVE FOR THE YEAR ENDED 30 JUNE 2023

President’s and Chief Executive’s Report

The business plan for the year was clear that the focus for the year should be one of maintaining and, where possible, increasing the volume of activities provided by the association to support the membership. At the same time, it was important to ensure the organisation was financially sustainable by making a surplus to bring reserves further back to the level they were at pre-pandemic.

We are delighted to be able to say that both objectives were achieved. The volume of activity and support to members has been greater than ever, while, financially, the statutory accounts show a surplus of £416,000 for the year to 30 June 2023. This financial result brings the financial reserves of the HFMA up to a level of £4,660,000, which is slightly ahead of the pre-pandemic position.

The year also saw major investment in the information technology and digital infrastructure at HFMA, one of the key strands of our strategy.

The first of these projects to be completed was a total revamp of the audio-visual system and supporting software at our conference centre in London, 110 Rochester Row. This puts this facility in the top quartile of London venues in terms of in-house technology.

The other two projects started in the year are a totally new website and content management system, which is planned to be completed by December 2023, and the development of a new and streamlined learning management system (LMS). The LMS project is due for completion in mid-2024 and will enhance the functionality and simplify the systems we use to deliver our hugely successful on-line training.

This investment in information technology and digital infrastructure ensures a better and more personalised service to our members, which is what our membership has asked for.

When we develop our business plan, we set key performance indicators in addition to financial targets, which we measure ourselves against each year. These show that, as at 30 June 2023, we had reached a record 22,420 members (full and associate) and supported them and others with, for example: 239,669 hours of continuing professional development and the production of 37 policy briefings and publications. We also had an average of 87 students studying for our qualifications over the year.

We ask attendees and users of all our activities to give feedback. Over the last year we achieved an amazing 98% ‘good’ or ‘excellent’ on events and the same result from everyone undertaking our bitesize e-learning. We are very proud of this feedback.

Finance Academy and the Finance Innovation Forum. We are proud to be a part of this exciting set of programmes.

We have also enjoyed working with and continuing to host the Healthcare Project and Change Management Association (HPCA) and to assist it in further developing its support for members at the same time as building a backoffice function.

With support from members, the association was also able to significantly increase the public benefit of its activities. This was evidenced by the levels of social media traffic and the downloads of free material from the website.

Our theme for the year has been Strength in numbers . This encouraged members to reassert the influence of the finance function on discussions throughout the NHS to deliver effective and sustainable patient services. It also reflected aims to strengthen the HFMA network through a diverse and inclusive membership, fully representing the healthcare finance community at all agenda for change band levels.

The highlight of the year linked to the theme has been the development of the bands 2 to 6 and apprenticeship offer and the full rolling out of free membership to this group. This has been a huge success with 3,356 full members in this group at 30 June 2023.

We would like to take this opportunity to thank our friends on the corporate partner programme, who provide us with valuable resources, without which we would not be able to run our central infrastructure. They, along with all our commercial supporters, continue to be very supportive in these challenging times, for which we are very grateful.

At HFMA, we will continue to work hard to support our members as the NHS beds in the new system way of working and integrated care. There is still much to do to ensure the new, more collaborative approach delivers the best possible care for patients. But along with our members, we will work hard to help provide the right infrastructure for this to be a success.

Thank you for reading this annual review. As always, please do not hesitate to contact us with any comments or thoughts and our best wishes to you all.

Lee Bond Mark Knight president chief executive

During the year to 30 June 2023, we also continued to host, work alongside and support One NHS Finance with the delivery of its programme of work in England. This encompasses Future-Focused Finance, the National

HFMA ANNUAL REPORT 2022 – 2023 3 Company Number: 5787972

REPORT OF THE TRUSTEES FOR THE YEAR ENDED 30 JUNE 2023

Trustees’ Report

The Trustees’ report also contains the Directors’ report as required by company law. The Trustees are also directors of Healthcare Financial Management Association for the purposes of company law.

OBJECTS AND AIMS

THE OBJECTS AND AIMS OF HFMA

HFMA is a charity which works with the healthcare sector to advance effective financial management. Its objects and aims are to:

STRATEGIC REPORT

Working with key stakeholders and building constructive and productive relationships remains important and a key component of our success.

To this end we continue to meet regularly with the policy and decision makers in the NHS in Wales, Northern Ireland and Scotland, as well as England.

In England, we continued to work with key players in the healthcare sector such as the Department of Health and Social Care and NHS England and NHS Improvement. We are delighted to continue to be the prime partner for One NHS Finance ONF continuing to provide the administration and delivering a big part of the programme.

We also continue to work closely with the main accountancy bodies, NHS Confederation and the Kings Fund as well as a number of key private sector organisations in moving the finance agenda in health forward.

We continued developing our library of books, reports and briefings, producing 32 briefings and publications in the year.

To create relevant and affordable development and qualification opportunities : We continue to deliver the HFMA Diploma (DHBF) and Higher Diploma in Healthcare and Business Finance (HDHBF).

ACHIEVEMENTS AND PERFORMANCE IN THE YEAR

The activities and achievements in the year against each of our strategic objectives as laid out in the strategy are summarised below:

To provide excellent members networks and services : The number of individual members of HFMA at the end of the year totalled 22,420 (2021/22: 10,653).

We were very pleased that our investments over the years in IT and digital mechanisms, such as Microsoft Teams, e- learning, webinars, social media and the website have allowed us to continue delivering member benefits and indeed a wider public benefit to all in the NHS over the last year.

Our website had 216,798 visits over the year, we had 4,853 twitter followers and 9,101 LinkedIn members.

Our organisation facing offerings continue to be very popular. Virtually every NHS organisation is now a Hub member.

We also ensure all our membership offerings are now focussed to support the new place-based structures in place for our members organisations.

To become the voice of healthcare finance through the development of leading-edge policy and technical work : There have been considerable developments in policy and technical work during the year and we have built on the many new activities that were initiated when the impact of Covid-19 was first felt.

During the year to 30 June 2023, we had an average of 87 students studying for our qualifications.

The Association continues to be the place most NHS finance staff go to satisfy their CPD requirements. Total CPD hours delivered in the year reached 239,669. This continues one of the key statistics that demonstrates the continuing interest our membership and the wider finance community in health has for HFMA’s training; be it events, webinars, qualifications or e-learning. Just as importantly HFMA targets a 90% excellent/good score from user feedback. Over the year to 30 June 2023 the average over all events was 98% a statistic we are very proud of.

Over the year we ran a vast array of face-to-face events but also continued to use the virtual platforms we put in place during the pandemic. We have been constantly talking to our members to get the mix right. The most popular events include our National Annual conference in December and our Pre-Accounts Planning event in February, which was well-attended.

Our e-learning “bitesize” modules have proven to be very sought after by the NHS finance function over the year last year. Part of the offering now includes some modules that have been uploaded onto the NHS ESR system allowing nearly all employees in the NHS to access them free of charge. At the time of writing some 52,000 downloads had taken place.

Once again, we are very proud to report that the target of achieving over 90% of users scoring each module excellent or good was achieved at 98%.

HFMA ANNUAL REPORT 2022 – 2023 4 Company Number: 5787972

REPORT OF THE TRUSTEES FOR THE YEAR ENDED 30 JUNE 2023

The bitesize e-learning modules continue to be improved and updated on an annual basis, drawing on technical expertise from our content team, our members and the graphical skills of instructional designers. As a result of this, the introductory suite of modules continues to train and inspire NHS staff.

During the year we worked closely with the NHS finance function and ONF in developing the Regional Finance Academies. These incorporate all training and development activities in each region and include the Skills Development Networks (SDN’s) and Finance and Management Training Schemes (FMTS). The FMTS scheme now also incorporates apprenticeship schemes. HFMA continues to run many of these networks and schemes across the country.

Managing ourselves effectively as a business : This is the fourth and final objective and covers the enabling functions of the business.

The financial element of this objective is covered separately

terms and conditions, renumeration and benefits for staff are appropriate and at least match the market.

FINANCIAL REVIEW

The result for the year is a surplus of £416,000 (2021/22 a surplus of £290,000).

This means reserves are now at £4,660,000 which means reserves are back to being just above the level they were pre-pandemic. A summary of the financial results for the last four years is shown below:

2019/20 2020/21 2021/22 2022/23
£ £ £ £
Turnover 6,668,000 5,453,000 7,170,000 8,686,000
Net result (779,000) 348,000 290,000 416,000
Net assets 3,606,000 3,954,000 4,244,000 4,660,000

below.

After moving into the new owned premises in Bristol last financial year the focus in terms of capital projects has been working on the information technology and digital infrastructure of HFMA with three projects.

The first of these was an upgrade of the audio-visual system and supporting technology at the conference centre, 110 Rochester Row in London. This project involved spend of just under £200,000 but has put the conference centre in the top quartile of venues in London in terms of technology and is already proving to be paying for itself in terms of an increasing client base.

The second of these is a total re-build of the website and content management system at the HFMA. The approved business case involves spend of £300,000 and the project is expected to be completed by December 2023.

Finally, the trustees approved a business case during the year for a new learning management system to be built to hold all on-line learning activities. This project will bring the software up to date and allow for a streamlining of existing processes and systems. Total spend of £400,000 has been approved and the new system is expected to “go-live” in mid-2024.

The base IT systems are all up-to-date and we are now in a position where almost all systems are cloud based and each member of staff is fully mobile and has an up-to-date laptop.

The Human Resources function has been very busy over the year. The move into HFMA House allowed new working practices to be put into place so that all staff are now able to work from home or from the office. This has been a great step forward and has allowed the positives from the pandemic to be fully integrated into the way of working at the association.

Our staff continue to be our most valuable resource and a full review continues to take place each year to ensure

The increase in income between 2020/21 and 2022/23 reflects in the main the move back to more face-to-face events during the last two years and more activity on education programmes commissioned by the NHS. It does also reflect that fact that almost everything that HFMA does is now back to pre-pandemic levels other than the conference centre, 110 Rochester Row, which in the early part of the year was impacted by strikes which has held back its recovery.

----- Start of picture text -----
Income
Qualifications
E learning ‐
3% Members
Bitesize…
Subs
Other 2%
4%
Trading
Conferences
55%
& events
27%
----- End of picture text -----

Conferences and training events income in 2022/23 totalled £2,353,000 (£1,961,000 in 2021/22). Which reflects the increase in face-to-face events year on year and more NHS commissioned activities.

E-learning (Bitesize) income totalled £761,000 in 2022/23, (£826,000 in 2021/22) a small decrease year on year but still very popular within the NHS and increasingly the private sector.

Qualifications income totalled £284,000 in 2022/23

HFMA ANNUAL REPORT 2022 – 2023 5 Company Number: 5787972

REPORT OF THE TRUSTEES FOR THE YEAR ENDED 30 JUNE 2023

(£267,000 in 2021/22) a slight increase year-on-year reflecting a small increase in development income rather than an increase in student income which is static year on year.

The income from the trading subsidiary HFMA Ltd is considerably above the previous year at £4,745,000 for 2022/23 (£3,878,000 in 2021/22). This is as a result of more activities taking place than in the previous year and sponsorship income being back to pre-pandemic levels.

The breakdown of expenditure is shown below:

----- Start of picture text -----
Expenditure
Members
E learning ‐Qualifications Services
6%
Bitesize 11%
6%
Conferences
& events
Trading
32%
45%
----- End of picture text -----

year at £505,000 in 2022/23 (£480,000 in 2021/22). With income slightly down the result is a decreased contribution at £256,000 in 2022/23 (£346,000 in 2021/22). This line of activity provides an important contribution to cover the costs of the association’s activities.

It should be noted that the surplus in the trading subsidiary HFMA Ltd of £819,000 in 2022/23 (£1,016,000 in 2021/22). This is a good result although lower year on year. This is due to a number of lower margin activities taking place in terms of events which were run face-to-face rather than online and so gives a lower margin.

This surplus is passed by gift aid to HFMA and was used by the charity to subsidise the cost of activities and services provided to the members of HFMA as noted above.

The financial statements have been prepared in accordance with relevant law and current accounting conventions and in particular the Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) – (Charities SORP (FRS 102)).

PUBLIC BENEFIT

To meet the objective of providing Public Benefit, HFMA offers training courses through branch and national events in the form of conferences and seminars, webinars, training publications and materials and online through our e- learning service.

By far the greatest activity in terms of income, other than the trading activities in the subsidiary companies noted above, is conferences and events. Expenditure totalled £2,702,000 in 2022/23 (£2,216,000 in 2021/22). The increase reflects the fact that costs of running face to face events are considerably higher than the costs of running virtual events. It is also the case that conferences and events run at a planned loss and are subsidised by other activities.

Members subscriptions totalled £163,000 in 2022/23 (£174,000 in 2021/22). The costs of member services are a little below the previous year at £896,000 in 2022/23 (£955,000 in 2021/22). The reduction in members subscriptions is mainly due to the decision being taken to provide membership free to all NHS staff on bands 2-6 and apprentices. This has led to a small reduction in membership income but a huge increase in membership and so has been a great success.

It is congruent with the objects and aims of the charity and the Charity Commission’s guidance on Public Benefit, that subscriptions paid by members cover only a small percentage of the costs of providing member services with the surpluses achieved in the trading operations of HFMA subsidising the balance of the costs. The trading surpluses are also used to subsidise conferences and events which also run at a planned loss as noted above.

The costs of e-learning, Bitesize, packages are up year-on-

Following the impact of Covid-19 a special portal was set up on the HFMA website into which materials were placed to support all those in healthcare working to manage the impact of the pandemic on their job. This portal was free access to all.

All these activities contribute to the Public Benefit provided by HFMA in assisting healthcare managers in providing a high quality and efficient service to the public.

The 100% owned trading subsidiary HFMA Ltd operates commercial activities to support the work of HFMA. The results are shown in Note 16 to the Accounts.

HFMA Commercial Services Limited is also 100% owned but has not traded in the year.

The activities and achievements of the charity in the year to 30 June 2023 are detailed in the President and Chief Executive’s report with commentary as to how the objectives set were met. These achievements demonstrate how successful HFMA has been in fulfilling its objectives and providing a Public Benefit.

FUTURE PLANS

The new strategy for the three years to 30 June 2026 was launched in September 2022.

HFMA ANNUAL REPORT 2022 – 2023 6 Company Number: 5787972

REPORT OF THE TRUSTEES FOR THE YEAR ENDED 30 JUNE 2023

The business plan for the second year of this strategy for the year to 30 June 2024 has been produced.

The plans for the year ahead for each main objective in the strategy and business plan for the year are detailed below:

The plans noted above, and the activities undertaken in the year show how the objects and aims of the charity continue to be satisfied. These are a clear demonstration of how HFMA provides a Public Benefit by providing services and support to a membership of people working in finance and related areas in healthcare management.

Most training activities are open to non-members as well as

members, often free of charge, ensuring that all members within a health system can benefit from HFMA’s expertise. A bursary fund also exists to support members or potential members who are unable to access the services provided by HFMA due to financial constraints.

The Trustees consider they have complied with their duties with regard to the Charity Commission’s Public Benefit guidance.

RESERVES AND GOING CONCERN

HFMA’s total reserves which have been built up slowly over many years were severely reduced in the year to 30 June 2020 by £779,000 as a direct result of lost revenue due to the impact of Covid-19. The results for the years to 30 June 2021, 2022 and 2023 have achieved that goal with reserves now standing at £4,660,000 (2021/22 £4,244,000).

All reserves are held in funds whose use is at the discretion of the Trustees as long as they are used as laid out in the objects and aims of the charity. The reserves policy below is set by the Trustees.

The Association’s policy is to secure its viability beyond the immediate future. This requires some income to be put aside, when this can be afforded, as a reserve against future uncertainties and opportunities:

All funds are unrestricted income funds. These are split into the following: General fund, Branch fund and Bursary fund.

None of the funds are in deficit. The balances on these funds are shown on the balance sheet and in note 17.

The Trustees consider it is appropriate to treat the Charity as a going concern.

This is due to the Trustees and Senior Management team having a clear understanding of the risks facing the organisation and robust cash management plans.

The largest uncertainty facing the Charity is the ability to run events at the Conference Centre in London, 110 Rochester Row. However, stress testing the budget and resulting cash flow forecasts for this risk, alongside considering other downside risks, shows that HFMA has cash reserves available for the period to 30 June 2025.

It is also worth noting that if needed HFMA has fixed assets investments which could be sold if further cash was required. The value of these investments at 30 June 2023

HFMA ANNUAL REPORT 2022 – 2023 7 Company Number: 5787972

REPORT OF THE TRUSTEES FOR THE YEAR ENDED 30 JUNE 2023

was £1,944,000.

The investment approach is discussed and agreed annually and confirmed at Board meetings. It was agreed that a considerable amount of funds should be held in easily accessible accounts (that attracted lower interest than could be achieved if the funds were tied up in fixed term accounts) to allow the Trustees to move quickly if there was an opportunity to invest in assets that supported HFMA’s strategic objectives to support the members and maintain the long-term future of the Charity.

TRUSTEES’ RESPONSIBILITIES IN RELATION TO THE

FINANCIAL STATEMENTS

The Trustees (who are also directors of Healthcare Financial Management Association for the purposes of company law) are responsible for preparing the Trustees’ Report and the financial statements in accordance with applicable law and United Kingdom Generally Accepted Accounting Practice.

Company law requires the Trustees to prepare financial statements for each financial year that give a true and fair view of the state of affairs of the charitable company and the Group and of the incoming resources and application of resources, including the income and expenditure, of the Charitable Group for that period. In preparing those financial statements, the Trustees are required to:

The Trustees are responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the financial position of the charitable company and group and enable them to ensure that the financial statements comply with the Companies Act 2006, the Charities Act 2011, the Charities and Trustee Investment (Scotland) Act 2005 and the Charities Accounts (Scotland) Regulations 2006. They are also responsible for safeguarding the assets of the charitable company and the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. In so far as the Trustees are aware:

The Trustees are responsible for the maintenance and integrity of the corporate and financial information included on the charitable company's website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

The Trustees confirm that they have complied with the duties of the Charities Act 2011 to have due regard to the Charity Commission’s general guidance on Public Benefit.

The Trustees have referred to the guidance in the Charity Commission’s general guidance on Public Benefit when reviewing the charity’s aims and objectives and in planning the charity’s future activities. In particular, the Trustees have considered how planned activities will contribute to the aims and objectives they have set.

INVESTMENT POLICY

The Investment Policy is to match the risks and accessibility of the assets invested in against the reason behind the investments being made in that:

Any major capital investment over £75,000 requires Trustee approval and should be supported by a business case and with appropriate professional advice.

For all investments made, targets will be set for these assets to at least equal the performance of average indices (for instance in the increase/decrease in value of commercial properties or financial instruments traded).

The Trustees will make no direct investment in companies whose products or services are accepted as being prejudicial to good health. In considering collective investments the Trustees will consider the nature and significance of the health risks associated with the products or services of any such company whose shares form a component of the collective investment.

CONSTITUTION AND GOVERNANCE

HFMA was incorporated as a company limited by guarantee registered in England and Wales in July 2006; a Memorandum and Articles of Association govern it.

HFMA ANNUAL REPORT 2022 – 2023 8 Company Number: 5787972

REPORT OF THE TRUSTEES FOR THE YEAR ENDED 30 JUNE 2023

The registered name and registered office of the Charity and names of the Trustees, who are directors for the purposes of company law, are shown on page 2 of this report. HFMA wholly owns two trading subsidiaries, HFMA Ltd, and HFMA Commercial Services Limited. These are private limited companies and they gift aid any profits to the Association. The Board of Trustees are the legal trustees and have control of the assets of the Charity.

During 2022/23, the Board of Trustees comprised the National President, two Vice-Presidents, Past Chair and Chair of the Audit and Finance Committee, who are nominated by the membership as a whole, and a representative from each of the three devolved nations who are elected by their branches and seven Trustees who are appointed by Board of Trustees. All the Trustees are directors of HFMA.

During the year the Board usually meets formally four times. When appropriate or necessary additional Board meetings are called. These meetings along with briefing papers for the Board ensured the Trustees were fully briefed on the risks and actions being taken and fully involved in decision making over this period.

Over the year, in addition to regular Board meetings, the Audit and Finance Committee and the Appointments and Remuneration Committee met four times. These two committees have delegated powers and responsibilities that are documented and approved by the Board.

The Appointments and Remuneration Committee also considers and recommends to the board the remuneration of the CEO, Deputy CEO & Director of Finance and Director of Policy & Research. This involves a review of the marketplace to allow benchmarking to take place and consideration of the roles and responsibilities of each post.

The day to day running of HFMA is delegated by the Board to the CEO and Senior Management Team. Senior Management Team meetings take place monthly.

Each week there is a whole-organisation meeting where the CEO leads a briefing with contributions from across the organisation.

The 13 branches have their own volunteer branch executives usually comprising a Branch Chair, a Branch Treasurer and a Branch Secretary.

The year to 30 June 2023 was the first year of the 2023-26 strategy. The strategy has been communicated to every member of HFMA and further details can be found on HFMA’s website www.hfma.org.uk. Each year staff are involved in delivering and updating progress against the strategy. As usual the annual business plan for the year ahead was also agreed as were individual business plans for each branch.

There is a Scheme of Delegation which states the level of authority required for decision making and expenditure which is reviewed by the Trustees each year. Each activity

undertaken by HFMA is monitored on a regular basis and each Manager has specific responsibility not only for the short-term management of the risk profile but also for the long-term prognosis of these individual income and cost lines. Physical risk is covered by specific systems for example in IT recovery and backup, emergency procedures and the provision of comprehensive insurance for assets and personnel.

HFMA is committed to recruiting Trustees with appropriate skills and talents. Vacancies for Trustee and other committee posts are advertised widely to the membership.

The Appointments and Remuneration Committee consider the applications and they select Trustees on the basis of established criteria. New Trustees receive full induction from the Chief Executive and regularly attend HFMA run CPD (Continuing Professional Development) sessions throughout the year.

RISK MANAGEMENT

The Association regards the management of risk as a key issue within its overall operating framework. A risk register is maintained and is considered regularly throughout the year by management, by the Audit and Finance Committee at each of its four meetings during the year and is annually presented and reviewed by the Board of Trustees.

Monthly management accounts and related information is produced and along with a programme of scrutiny by internal auditors, this provides the information the executives and trustees require to run the charity and gives the assurance required for the Board to fulfil its role in terms of risk and assurance management.

The Group’s key business risks are around its income due to the fact that, unlike most membership organisations, a very small amount of income is derived from membership subscriptions. Therefore, HFMA relies on other sources of income to fund its membership activities. In recent years these sources of non-membership income have diversified significantly, thus spreading the operational risk.

In the last quarter of the year to 30 June 2020 HFMA pivoted the operations of the organisation to manage the impact of Covid-19. The management of this risk led to all HFMA’s staff moving to working from home, all face-to-face events were cancelled or moved to being run as virtual events and the conference centre 110 Rochester Row was closed.

The Business Continuity planning ensured that the impact of Covid-19 was managed and HFMA was able to start the year from 1 July 2020 having fully pivoted the business model. This included mitigations around cost being put in place to bring the expenditure of the Charity down to match a prudent estimate of income going forward from 1 July 2020.

Although these mitigations give the Board comfort that the risk around the impact of Covid-19 is being managed appropriately, the risk of further negative impacts on income still exists notably at 110 Rochester Row and so this is still

HFMA ANNUAL REPORT 2022 – 2023 9 Company Number: 5787972

REPORT OF THE TRUSTEES FOR THE YEAR ENDED 30 JUNE 2023

seen as the major risk that the Charity needs to manage at the time of writing this report.

The Business Continuity Plan is kept up to date and is designed to ensure under any circumstance HFMA can maintain its operations.

SERVICES PROVIDED BY OTHER BODIES

Moorepay Limited, a division of Northgate Information Solutions, provided a payroll service.

RSM UK Audit LLP and Audit South West NHS Audit Consortium provided audit services.

BRANCHES

The 13 regional branches form an integral part of the Association. The branches have the powers to run training and education events for the benefit of branch members. Branch funds are used to underwrite training and education opportunities and support local research initiatives.

AUDITOR

A resolution proposing that RSM UK Audit LLP be reappointed as statutory auditor of the Charity will be put to the Annual General Meeting on 7 December 2023.

The Trustees Report and the Strategic Report contained within it were approved by the Board on 7 November 2023 and signed on its behalf by;

Simon Crowther

Trustee and Chair of the Audit Committee.

HFMA ANNUAL REPORT 2022 – 2023 10 Company Number: 5787972

FINANCIALS – Statements of Financial Activities

Consolidated and charity statements of financial activities for year ended 30 June 2023 (including Income and Expenditure Accounts)

2021-22 2021-22 2022-23 2022-23
Unrestricted funds Unrestricted funds
Association Consolidation Notes Association Consolidation
£’000 £’000 £’000 £’000
INCOME 2
INCOME FROM RAISING FUNDS
Voluntaryincome
174 174 MemberSubscriptions and donations 163 163
Activitiesforgeneratingfunds
- 3,878 TradingTurnover:HFMALtd (excluding qualifications) 16 - 4,745
Investment income
154 56 Investmentincomeandinterestreceived 205 80
1,016 - Gift Aid from subsidiary to Association 819 -
INCOME FROMCHARITABLEACTIVITIES
1,963 1,961 Conferences and seminars 2,353 2,353
826 826 E-Learning (Bitesize) 761 761
2 2 Member services including publications and magazine 2 2
- 267 Qualifications - 284
32 6 Other income 325 299
4,167 7,170 TOTAL INCOME 4,628 8,687
EXPENDITURE 3
COST OFRAISING FUNDS
(159) (159) Costsofgeneratingvoluntaryincome (170) (170)
Costsoffundraisingtrading
- (2,546) HFMALtd (excluding qualifications) 16 - (3,712)
(51) - Management costs (depreciation) (41) -
COST OFCHARITABLEACTIVITIES
(2,264) (2,216) Conferences andseminars (2,808) (2,702)
(480) (480) E-Learning (Bitesize) (505) (505)
(796) (796) Member services including publications and magazine (726) (726)
- (556) Qualifications - (494)
(3,750) (6,753) TOTAL EXPENDITURE (4,250) (8,309)
36 36 RECOGNISED GAINS ON INVESTMENTS - -
(163) (163) UNRECOGNISED (LOSSES)/GAINS ON INVESTMENTS 38 38
290 290 NET INCOME 416 416
290 290 NET MOVEMENT IN FUNDS 416 416
3,954 3,954 BALANCEBROUGHTFORWARDAT 1JULY 4,244 4,244
4,244 4,244 FUND BALANCE CARRIED FORWARD AT 30 JUNE 17 4,660 4,660

All the above results derive from continuing activities and there were no gains or losses other than those shown above.

The notes on pages 14 to 29 form part of these accounts.

HFMA ANNUAL REPORT 2022 – 2023 11 Company Number: 5787972

FINANCIALS – Statement of financial position

Consolidated and charity statements of financial position as at 30 June 2023

30 June 2022
Association Consolidation
Notes
£’000
£’000
Fixed assets
4,276
4,320
Tangible assets
7a
35
35
Intangible assets
7b
1,906
1,906
Investments
7c
6,217
6,261
Total fixed assets
Current assets
-
2
Stocks
745
1,952
Debtors
8
979
3,969
Cash at bank and in hand
9
1,724
5,923
Total current assets
(3,685)
(6,546)
Creditors: Amounts falling due within one
year
10
(1,961)
(623)
Net current liabilities
Total assets less current liabilities
Creditors: Amounts falling due after more
(12)
(1,394)
than one year
11
4,244
4,244
Net assets
Unrestricted funds
3,580
3,580
General fund
Designated funds
626
626
Branch fund
38
38
Bursary fund
4,244
4,244
Total unrestricted funds
17		 30 June 2023
Association
Consolidation
£’000
£’000
4,197
4,400
234
234
1,944
1,944
6,375
6,578
-
1,914
4,301
1,467
2,904
3,381
7,205
(5,088)
(7,949)
(1,707)
(744)
(8)
(1,174)
4,660
4,660
3,972
3,972
649
649
39
39
4,660
4,660

The notes on pages 14 to 29 form part of these accounts.

The accounts were approved by the Board of Trustees on 7 November 2023

Lee Bond, President

HFMA ANNUAL REPORT 2022 – 2023 12 Company Number: 5787972

FINANCIALS – Statement of Cash Flows

Consolidated Statement of Cash Flows for the year ended 30 June 2023

2021-22
Notes
£’000
3,375
Net cash inflow/(outflow) from operating activities
14
Cash flows from investing activities
-
56
Interest received
Dividends received
(464)
Purchase of tangible fixed assets
(850)
Loans received(paid)
200
Sale of investments
(1,058)
Total (outflow) from investing activities
2,317
Increase/(Decrease) in cash		 2022-23
£’000
(694)
22
57
(450)
-
-
(371)
(1,065)

The notes on pages 14 to 29 form part of these accounts.

Reconciliation of net cash flow to movement in cash

2021-22
£’000
1,652
Cash at the beginning of the year
2,317
Increase/(Decrease) in cash in the year
3,969
Cash at the end of the year		 2022-23
£’000
3,969
(1,065)
2,904

Analysis of changes in net debt

Cash and cash equivalents
Cash
Borrowings
Debt due within one year
Total		 Asat 30 June 2022
Cash flows
As at 30 June 2023
£’000
£’000
£’000
3,969
(1,065)
2,904
-
-
-
-
3,969
(1,065)
2,904
Cash and cash equivalents
Cash
Borrowings
Debt due within one year
Total		 Asat 30 June 2021
Cash flows
As at 30 June 2022
£’000
£’000
£’000
1,652
2,317
3,969
(850)
850
-
802
3,167
3,969

HFMA ANNUAL REPORT 2022 – 2023 13 Company Number: 5787972

Notes forming part of the Financial Statements (continued) For the year ended 30 June 2023

1. Accounting Policies

a) GENERAL INFORMATION

HFMA is a limited company and charity incorporated in England and Wales. It is also a Charity in Scotland. The address of HFMA’s registered office is 110 Rochester Row, Victoria, London, SW1P 1JP. The principal places of business of HFMA are 110 Rochester Row, Victoria, London, SW1P 1JP and HFMA House, 4 Broad Plain, Bristol, BS2 0JB.

The HFMA Group consists of HFMA and all of its subsidiaries. The nature of HFMA Group’s activities are detailed in the Trustees report on pages 4 to 10 of these accounts.

b) BASIS OF PREPARATION

The financial statements have been prepared in accordance with Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective 1 January 2019) – (Charities SORP (FRS 102)). The Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) and the Companies Act 2006.

HFMA meets the definition of a public benefit entity under FRS 102. Assets and liabilities are initially recognised at historical cost or transaction value unless otherwise stated in the relevant accounting policy note.

c) GOING CONCERN

The accounts have been produced on the basis that the charity is a going concern. This is as a result of the trustees having a clear understanding of the risks facing the organisation and the existence of robust cash management plans. The Charity also has budgets and resulting cash flows which have been stress tested for the year ahead which support this view.

The largest uncertainty facing the Charity is the ability to run events at the Conference Centre in London, 110 Rochester Row. However, stress testing the budget and resulting cash flow forecasts for this risk, alongside considering other downside risks, shows that HFMA has cash reserves available at least through to 30 June 2025.

After taking into account the stress testing, there is still headroom over the period to 30 June 2025. If an unforeseen risk occurs or the risks considered in the stress testing are of a larger quantum than considered, HFMA has the ability to sell some or all of its fixed assets investments if further cash was required. The value of these investments at 30 June 2023 was £1,944k. It is worth noting that these investments if realised and turned into cash would turn the net current liabilities position of the Charity into a net current assets position at 30 June 2023. It is also worth noting that included in current liabilities in the balance sheet is £5,549k of deferred income, which if added back would also turn the net current liabilities position into a net current assets position.

d) REDUCED DISCLOSURES

In accordance with FRS 102, the Company has taken advantage of the exemptions from the following disclosure requirements;

e) FUNCTIONAL AND PRESENTATIONAL CURRENCY

The consolidated financial statements are presented in sterling which is also the functional currency of the Company.

f) FINANCIAL INSTRUMENTS

HFMA has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102, in full, to all of its financial instruments. Financial assets and financial liabilities are recognised when the Group becomes a party to contractual provisions of the instrument and are offset only when the Group currently has a legally enforceable right to set off the recognised amounts and intends to either settle on a net basis, or to realise the asset and settle the liability simultaneously.

HFMA ANNUAL REPORT 2022 – 2023 14 Company Number: 5787972

Notes forming part of the Financial Statements (continued) For the year ended 30 June 2023

1. Accounting Policies (continued)

f) FINANCIAL INSTRUMENTS (continued)

Financial assets

Trade, group and other debtors (including accrued income) which are receivable within one year and which do not constitute a financing transaction are initially measured at amortised cost, being the transaction price less any amounts settled and any impairment losses.

Where the arrangement with a debtor constitutes a financing transaction, the debtor is initially measured at the present value of future payments discounted at a market rate of interest for a similar debt instrument and subsequently measured at amortised cost.

A provision for impairment of trade debtors is established when there is objective evidence that the amounts due will not be collected according to the original terms of the contract. Impairment losses are recognised in profit or loss for the excess of the carrying value of the trade debtor over the present value of the future cash flows discounted using the original effective interest rate. Subsequent reversals of an impairment loss that objectively relate to an event occurring after the impairment loss was recognised, are immediately recognised in the statement of financial activities.

Financial liabilities

Financial instruments are classified as liabilities and equity instruments according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the Company after deducting all of its liabilities. Where the arrangement with a creditor constitutes a financing transaction, the creditor is initially measured at the present value of future payments discounted at a market rate of interest for a similar instrument and subsequently measured at amortised cost.

Trade, group and other creditors (including accruals) payable within one year that do not constitute a financing transaction are initially measured at the transaction price and subsequently measured at amortised cost, being transaction price less any amounts settled.

g) GROUP FINANCIAL STATEMENTS

These financial statements consolidate the results of the Healthcare Financial Management Association, including its branches (HFMA) and its wholly owned subsidiaries HFMA Ltd and HFMA Commercial Services Limited (HCS Ltd). Trading income and expenditure is identified separately in the Statement of Financial Activities and assets and liabilities are consolidated on a line-by-line basis.

h) INCOME

Income is recognised when you meet the criteria of entitlement, measurement and probability. Income invoiced for post year end activity is accounted for as deferred income and released to incoming resources in the relevant period subsequent to the year end. The following specific policies apply to categories of income:

i) VOLUNTEERS

The value of services provided by volunteers is not incorporated into these financial statements. There are many contributions made by volunteers including event speakers, committee members, Branch committee members and Trustees.

j) EXPENDITURE

Expenditure recognised when a liability is incurred and allocated to the appropriate heading in the accounts.

HFMA ANNUAL REPORT 2022 – 2023 15 Company Number: 5787972

Notes forming part of the Financial Statements (continued) For the year ended 30 June 2023

1. Accounting Policies (continued)

j) EXPENDITURE (continued)

k) LEASED BUILDINGS AND EQUIPMENT

The Association rents an office and a Conference Centre on a long lease. Long lease property is included in fixed assets and written off on a straight-line basis over 50 years from the point of first use. In the case of one long lease in London the fixed asset is written off on a straight-line basis over 50 years down to a residual value that is based on cost and is deemed appropriate after considering the market value of the long lease.

The costs of lease improvements and benefit of introductory rent and service charge free periods are allocated on a straightline basis over the period to the commencement of full rent in accordance with FRS 102.

All existing leases for cars and office equipment are treated as operating leases. The title to the cars and equipment remains with the lessor who retains the risk and rewards of ownership and the lease terms are shorter than the economic life. Rental charges are charged on a straight line basis over the term of the lease.

l) TANGIBLE FIXED ASSETS

Lease improvements and equipment acquired with a value in excess of £5,000 are capitalised at cost. Depreciation is provided when it comes into use to recognise the cost of the asset, its residual value and its estimated useful life and is included in support costs.

Depreciation on these assets is calculated as follows:

m) INTANGIBLE FIXED ASSETS

Software development costs and intellectual property are included in Intangible Fixed Assets at cost and are written off on a straight-line basis over the life of the asset which can vary from between 5 and 10 years.

n) INVESTMENTS

Current asset investments are included at market value. Gains and losses on disposal and revaluation are charged or credited to the Statement of Financial Activities.

o) STOCK

Stock is carried at the lower of cost or net realisable value. Stock comprises publications and training packages held for resale.

HFMA ANNUAL REPORT 2022 – 2023 16 Company Number: 5787972

Notes forming part of the Financial Statements (continued) For the year ended 30 June 2023

1. Accounting Policies (continued)

p) FUNDS STRUCTURE

All funds are unrestricted income funds. These are split into undesignated (the General and Branches funds) and designated funds (the Bursary and Deep Reserve funds). The General and Branches funds should be built up to at least six months’ worth of total annual costs of HFMA to cover short-term falling off in demand for the services offered. The Bursary fund is to support those with low incomes accessing the services of HFMA or assisting members in activities that benefit healthcare in the UK that they would not be able to perform without support.

q) PENSIONS

All staff are employed solely by the Association. Two Group Personal Pension Schemes are provided for staff joining the Association:

Some members of staff are members of the NHS Pension Scheme as designated under a direction agreement granted by the Secretary of State. The scheme is a multi-employer defined benefit scheme where the share of the assets and liabilities applicable to each employer is not identified. Accordingly, these financial statements include pension costs payable on a defined contribution basis in accordance with FRS 102.

Pension costs charged to the Statement of Financial Activities represent the contributions payable by the Association during the year.

r) FOREIGN CURRENCIES

Assets and liabilities in foreign currency are translated into sterling at the rate of exchange ruling at the balance sheet date. Transactions in the year in foreign currency are translated into sterling at the rate of exchange ruling at the date of the transaction. Exchange differences are recognised in the Statement of Financial Activities when arriving at the net movement in funds.

s) PROVISIONS

Provisions are recognised when the Company has an obligation at the reporting date as a result of a past event which it is probable will result in the transfer of economic benefits and that obligation can be estimated reliably.

Provisions are measured at the best estimate of the amounts required to settle the obligation. Where the effect of the time value of money is material, the provision is based on the present value of those amounts, discounted at the pre-tax discount rate that reflects the risks specific to the liability. The unwinding of the discount is recognised within interest payable and similar expenses.

t) SIGNIFICANT JUDGEMENT AND ESTIMATES

In the application of the charity’s accounting policies, the trustees are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Estimates and assumptions are reviewed on an ongoing basis. Actual results may differ from these estimates.

The only estimate of significance made by the trustees in the preparation of the financial statements is considered to be the period over which leasehold improvements are depreciated, which is as disclosed in Note 1 k).

The trustees consider there to be two key judgments made in the preparation of these financial statements. Firstly, the residual value of the long leasehold interest in Rochester Row which the trustees considered to be materially comparable to its cost. Secondly, the existence and valuation of deferred income for contracts. Revenue is recognised on contracts in line with the delivery of key milestones, costs incurred to date, or if these cannot be measured reliably, evenly over the life of the contract. These methods involve management making assumptions and judgements in relation to future delivery of these contracts, and as a result the value of deferred income is dependent on such judgements.

HFMA ANNUAL REPORT 2022 – 2023 17 Company Number: 5787972

Notes forming part of the Financial Statements (continued) For the year ended 30 June 2023

2. Income

a) INCOME FROM RAISING FUNDS

VOLUNTARY INCOME

The voluntary income received consists of membership subscriptions and grants and donations. Monies received from the Coronavirus Job Retention Scheme (CJRS) are shown under Grants and Donations below.

2021-22
Association
Consolidation
£’000
£’000
171
171
Subscriptions
3
3
Grants and Donations (CJRS
payments)
174
174		 2022-23
Association
Consolidation
£’000
£’000
163
163
-
-
163
163

ACTIVITIES FOR GENERATING FUNDS

For details of the trading turnover of HFMA Ltd, please see note 16a and HFMA Commercial Services Limited note 16b.

INVESTMENT INCOME AND INTEREST RECEIVED

2021-22
Association
Consolidation
£’000
£’000
(5)
56
Investment Income
159
-
Rental income
154
56		 2022-23
Association
Consolidation
£’000
£’000
46
80
159
-
205
80

b) INCOME FROM CHARITABLE ACTIVITIES

CONFERENCES AND SEMINARS

2021-22
Association
Association
£’000
£’000
1,691
1,691
National and regional events
270
270
Branchevents
1,961
1,961		 2022-23
Association
Consolidation
£’000
£’000
2,027
2,027
326
326
2,353
2,353

HFMA ANNUAL REPORT 2022 – 2023 18 Company Number: 5787972

Notes forming part of the Financial Statements (continued) For the year ended 30 June 2023

3. Expenditure

Salary and support costs (including governance costs) have been allocated to the relevant income stream. Salary costs have been split on the basis of salary percentage and the remaining support costs have been split on the basis of staff time.

All Charitable Activities are carried out through direct services. There is no grant funding to third parties.

COSTANALYSIS2022-23
Generating Voluntary Income
Conferences and Seminars
E-learning
Member Services including
publications and magazine
Qualification
Total Association
HFMA Ltd
Consolidated		 Direct Costs
Support Costs
TOTAL
2022-23
£'000
£'000
£'000
7
163
170
1,683
1,019
2,702
50
455
505
48
678
726
96
398
494		 TOTAL
2021-22
£'000
159
2,216
480
796
556
1,884
2,713
4,597
1,417
2,295
3,712		 4,207
2,546
3,301
5,008
8,309		 6,753

a) COSTS OF GENERATING FUNDS

These consist of Generating Voluntary Income and HFMA Ltd noted above.

b) COSTS OF CHARITABLE ACTIVITIES

These consist of Conferences and Seminars, Publications and Training Packages, E-learning, Membership Services including Healthcare Finance magazine, the Qualifications and Bursary noted above. These are split out on the face of the Statement of Financial Activities.

A breakdown of Conference and seminar costs split between centre events and branch events are shown below:

2021-22
Association
Consolidation
£’000
£’000
404
404
Branch events
1,812
1,812
Centre events
2,216
2,216		 2022-23
Association
Consolidation
£’000
£’000
459
459
2,243
2,243
2,702
2,702

4. Audit Fees

The total external audit fees were:

2021-22
Association
Consolidation
£’000
£’000
18
18
Charity
-
4
HFMA Ltd
18
22
-
3
Other services supplied by affiliates of RSM UK
Audit LLP		 2022-23
Association
Consolidation
£’000
£’000
21
21
-
4
21
25
-
3

HFMA ANNUAL REPORT 2022 – 2023 19 Company Number: 5787972

Notes forming part of the Financial Statements (continued) For the year ended 30 June 2023

5. Staff Costs and Trustees’ Remuneration

All staff are employed by HFMA and therefore the figures below are for both the charity and group accounts. Trustees give their service voluntarily and received no remuneration or benefits in kind in respect of the performance of their duties as a Trustee in the year see note 5f.

a) STAFF COSTS

a)STAFF COSTS
2021-22
£’000
2,700
Staff salaries
289
Employers NI costs
315
Pensioncosts
115
Sundry (including Childcare Vouchers
and Staff Training)
3,419		 2022-23
£’000
3,302
345
401
203
4,251

Staff costs are allocated according to the functions of each staff member: £1,866,000 in 2022/23 (2021/22 £1,603,000) is included in direct costs, £2,385,000 in 2022/23 (2021/22 £1,679,000) in support costs together they form part of trading costs, fundraising costs, and charitable expenditure, as appropriate (see note 3).

b) AVERAGE NUMBER OF STAFF DURING THE YEAR

The average employee headcount throughout the year:

2021-22 2022-23
43 Operations/Technical 52
4 Qualification 5
7 BusinessDevelopment 6
17 Administration 17
71 79

c) EMOLUMENTS

The number of employees whose emoluments (including remuneration and benefits in kind but excluding pension contributions) that amounted to over £60,000 was:

2021-22 2022-23
5 Band £60,000 - £70,000 5
1 Band £70,001 - £80,000 2
2 Band £80,001 - £90,000 -
0 Band £90,001 - £100,000 1
- Band £100,001 - £110,000 1
1 Band £110,001 - £120,000 -
- Band £120,001 - £130,000 1
1 Band £180,001 - £190,000 -
- Band £200,001 – £210,000 1

d) KEY MANAGEMENT

The key management of HFMA during the year were the Chief Executive, Deputy Chief Executive & Director of Finance and the Director of Policy whose combined working weeks totalled to the equivalent of 2.8 full time equivalent (FTE) employees. Their employee benefits including remuneration, benefits in kind, employers pension costs and employers National Insurance total £533,000 for 2022/23 (2021/22 Chief Executive, Deputy Chief Executive & Director of Finance, Director of Policy & Research and Director of Education & Development, 2.8 FTE and total cost £478,000).

e) PENSIONS

As detailed in Pensions accounting policies note 1 there are currently three pension schemes operating.

HFMA ANNUAL REPORT 2022 – 2023 20 Company Number: 5787972

Notes forming part of the Financial Statements (continued) For the year ended 30 June 2023

5. Staff Costs and Trustees’ Remuneration (continued)

f) TRUSTEES

Trustees give their services voluntarily and receive no remuneration or benefits in kind for the performance of their duties as a Trustee. Trustees’ fees for other services and out of pocket expenses paid direct or to third parties that were reimbursed by the Association are:

2021-22
Type of Expense
£’000
1
Subsistence
3
Travel
3
Accommodation
3
Training
10		 2022-23
£’000
-
18
-
1
19

6. Property and Operating Lease Commitments

The total future minimum commitments payable in respect of property and operating leases shown below are analysed according to the expiry of the leases.

2021-22 2021-22 2022-23 2022-23
Association Consolidation Association Consolidation
£’000 £’000 £’000 £’000
27 27 One year or less 63 63
40 40 Two to five year 56 56
- - Over 5 years 4 4

Property and operating lease costs shown within the statements of financial activities within support costs were £38,000 in 2022/23 (2021/22 £5,000) for Association and £38,000 in 2022/23 (2021/22 £5,000) for the consolidated group.

7.a) Tangible Fixed Assets

Tangible fixed assets held in the HFMA Group consolidated accounts are below:

Cost as at 1 July 2022
Additions
Cost of assets written off
Cost as at 30 June 2023
Cumulative depreciation as at 1 July 2022
Depreciation charge for the year
Depreciation on assets written off
Cumulative depreciation as at 30 June
2023
Net book value as at 1 July 2022
Net book value as at 30 June 2023		 Freehold
Long
Leasehold
Leasehold
Improvements
Equipment
Total
£’000
£’000
£’000
£’000
£’000
1,104
2,030
1,345
456
4,935
1
-
-
215
216
(4)
-
-
(319)
(323)
1,101
2,030
1,345
352
4,828
11
29
216
359
615
22
-
27
46
95
-
-
-
(282)
(282)
33
29
243
123
428
1,093
2,001
1,129
97
4,320
1,068
2,001
1,102
229
4,400

HFMA ANNUAL REPORT 2022 – 2023 21 Company Number: 5787972

Notes forming part of the Financial Statements (continued) For the year ended 30 June 2023

7. a) Tangible Fixed Assets (continued)

Tangible fixed assets held in the HFMA Company accounts are below:

Cost as at 1 July 2022
Additions
Cost of assets written off
Cost as at 30 June 2023
Cumulative depreciation as at 1 July 2022
Depreciation charge for the year
Depreciation on assets written off
Cumulative depreciation as at 30 June
2023
Net book value as at 1 July 2022
Net book value as at 30 June 2023		 Freehold
Long
Leasehold
Leasehold
Improvements
Equipment
Total
£’000
£’000
£’000
£’000
£’000
1,104
2,030
1,344
304
4,782
1
-
-
1
2
(4)
-
-
(229)
(233)
1,101
2,030
1,344
76
4,551
11
29
213
253
506
22
-
27
19
68
-
-
-
(220
(220)
33
29
240
52
354
1,093
2,001
1,131
51
4,276
1,068
2,001
1,104
24
4,197

7.b) Intangible Fixed Assets

Intangible fixed assets held in the HFMA Group consolidated accounts are below:

Cost as at 1 July 2022
Additions
Cost of assets written off
Cost as at 30 June 2023
Cumulative amortisation as at 1 July 2022
Amortisation charge for the year
Amortisation of assets written off
Cumulative amortisation as at 30 June
2023
Net book value as at 1 July 2022
Net book value as at 30 June 2023		 Software
Total
£’000
£’000
209
209
234
234
(100)
(100)
343
343
174
174
10
10
(75)
(75)
109
109
35
35
234
234

HFMA ANNUAL REPORT 2022 – 2023 22 Company Number: 5787972

Notes forming part of the Financial Statements (continued) For the year ended 30 June 2023

7.b) Intangible Fixed Assets (continued)

Intangible fixed assets held in the HFMA Company accounts are below:

Software Total
£’000 £’000
Cost as at 1 July 2022 189 189
Additions 234 234
Cost of assets written off (100) (100)
Cost as at 30 June 2023 323 323
Cumulative amortisation as at 1 July 2022 154 154
Amortisation charge for the year 10 10
Amortisation of assets written off (35) (617)
75)		 (652)
7 )
Cumulative amortisation as at 30 June
2023		 89 89
Net book value as at 1 July 2022 35 35
Net book value as at 30 June 2023 234 234

7. c) Investments

7. c) Investments 7. c) Investments
All investments are owned byHFMA and therefore the figures below are for both the Charity and group accounts.
**Market Value as ** Disposal **Market value as ** Gain in
**at 30 June 2022 ** at 30 June 2023 year
£’000 £’000 £’000 £’000
CCLA Funds 1,091 - 1,120 29
Barclays Funds 815 - 824 9
Total 1,906 - 1,944 38

The gain in the year was all unrealised.

8. Debtors

. Debtors
as at 30 June 2022 as at 30 June 2023
Association Consolidation Association Consolidation
£’000 £’000 £’000 £’000
541 1,697 General debtors 1,616 3,906
26 - Amounts due from group companies 61 -
178 255 Prepayments & accrued income 237 395
745 1,952 1,914 4,301

9. Cash at bank and in hand

The bank and cash accounts held are as follows:

as at 30 June 2022 as at 30 June 2023
Association Consolidation Association Consolidation
£’000 £’000 £’000 £’000
979 3,969 Current accounts 147 1,584
- - Deposit accounts 1,320 1,320
979 3,969 Total cash balance **1,467 ** **2,904 **

HFMA ANNUAL REPORT 2022 – 2023 23 Company Number: 5787972

Notes forming part of the Financial Statements (continued) For the year ended 30 June 2023

10. Creditors – Amounts falling due within one year

as at 30 June 2022
Association
Consolidation
£’000
£’000
422
733
Trade creditors
1,249
-
Amounts due to group companies
89
89
Social security creditors
30
30
Pension creditors
-
27
Othercreditors
593
776
Accruals
1,302
4,891
Deferredincome
3,685
6,546		 as at 30 June 2023
Association
Consolidation
£’000
£’000
622
1,013
1,922
-
95
96
40
40
14
122
754
1,129
1,641
5,549
5,088
7,949

Deferred income as at 30 June 2023 consists of the income for events and service delivery that takes place in the next financial year.

Movements on deferred income for events and service delivery that takes place in the next financial year was as follows:

2021-22
Association
Consolidation
£’000
£’000
1,389
3,628
Deferred Income falling due within one
yearasat 1July
(1,389)
(3,628)
Releasedduringyear
1,302
4,891
AdditionalDeferredIncome foryear
1,302
4,891
Deferred Income falling due within one
year carried forward as at 30 June		 2022-23
Association
Consolidation
£’000
£’000
1,302
4,891
(1,302)
(4,891)
1,641
5,549
1,641
5,549

11. Creditors – Amounts falling due after more than one year

as at 30 June 2022
Association
Consolidation
£’000
£’000
12
1,394
DeferredIncome
12
**1,394 **		 as at 30 June 2023
Association
Consolidation
£’000
£’000
8
1,174
8
1,174

Deferred Income as at 30 June 2023 consists of the income for events and service delivery that takes place in more than one year.

Movements on deferred income that relates to income for events and service delivery that takes place in more than one year were as follows:

2021-22
Association
Consolidation
£’000
£’000
14
370
Deferred Income falling due after more than
one yearasat 1July
(14)
(370)
Releasedduringyear
12
1,394
Additional DeferredIncome foryear
12
1,394
Deferred Income falling due after more than
one year carried forward as at 30 June		 2022-23
Association
Consolidation
£’000
£’000
12
1,394
(12)
(714)
8
494
8
1,174

HFMA ANNUAL REPORT 2022 – 2023 24 Company Number: 5787972

Notes forming part of the Financial Statements (continued) For the year ended 30 June 2023

12. Financial Instruments

The carrying amount of the Group’s financial instruments were;

Financial assets

as at 30 June 2022 as at 30 June 2023
Association Consolidation Association Consolidation
£’000 £’000 £’000 £’000
541 1,697 General debtors 1,616 3,906
26 - Amounts due from group companies 61 -
144 149 Accrued income 163 278

13. Analysis of Net Assets of Branches

The branches are part of the Association and run local training and education events for the benefit of branch members. Net assets held by the branches were:

Net assets at
30th June 2022
Branch
£’000
39
EastMidlands
25
Eastern
37
Kent,SussexandSurrey
25
London
39
North-West
60
Northern
45
NorthernIreland
19
Scotland
105
South-West
18
SouthCentral
62
Wales
137
WestMidlands
15
YorkshireandHumber
626		 Net assets at
30th June 2023
£’000
30
25
27
31
33
87
46
22
97
13
65
147
26
649

The overall surplus for the branches for the year was £23k (2022 a deficit of £12k).

HFMA ANNUAL REPORT 2022 – 2023 25 Company Number: 5787972

Notes forming part of the Financial Statements (continued) For the year ended 30 June 2023

14. Reconciliation of net expenditure to net cash flow from operating activities

Year to
30th June 2022
£’000
290
Net income/(expenditure) for the year:
144
Depreciation and amortisation
(36)
Realised loss/(gain) on sale of investment
163
Unrealised loss/(gain) on investment
51
Loss on assets written off
(56)
Interest and dividends receivable
556
EBITDA
1
(Increase)/decrease in stocks held
83
(Increase)/decrease in debtors
2,735
Increase/(decrease) in creditors
3,375
Net cash inflow/(outflow) from operating
activities		 Year to
30th June 2023
£’000
416
105
-
(38)
66
(79)
470
2
(2,349)
1,183
(694)

15. Related Party Transactions

The Association holds the entire issued share capital of 1 x £1 Ordinary Shares in HFMA Ltd, a private limited company incorporated in England and Wales (see note 17a). This represents the entire voting capital of HFMA Ltd. HFMA Ltd undertakes to remit all profits from HFMA Ltd to HFMA under the gift aid scheme.

Transactions with wholly owned group companies are detailed in notes 8, 10 and 16.

HFMA charges a percentage of its staff and overhead costs to HFMA Ltd based on the proportion of staff and management activity committed to the Company. The amount recharged in the year was £1,139,000 (2021/22 £1,024,000).

The Association holds the entire issued share capital of 1 x £1 Ordinary Shares in HFMA Commercial Services Limited (HCS Ltd), a private limited company incorporated in England and Wales (see note 17b). This represents the entire voting capital of HCS Ltd. HCS Ltd undertakes to remit all profits from HCS Ltd to HFMA under the gift aid scheme.

HFMA charges a percentage of its staff and overhead costs to HCS Ltd based on the proportion of staff and management activity committed to the Company. The amount recharged in the year was £nil (2021/22 £nil).

In order to facilitate a bank account pooling arrangement there is an unlimited Inter Company Composite Guarantee in respect of the bank accounts of HFMA, HFMA Ltd and HCS Ltd by which each company guarantees the liabilities of the other group members to National Westminster Bank Plc.

Most of the Charity Trustees are NHS senior managers whose organisations purchase services from HFMA and its subsidiaries in the normal course of activities.

16. Subsidiaries

a) HFMA LTD

The principal activities of the company are providing marketing services, arranging sponsorship and advertising, running a conference centre and running general and tailored events for the healthcare community. The Financial Statements of HFMA Ltd for the year to 30 June 2023, as consolidated into the accounts for HFMA, were:

HFMA ANNUAL REPORT 2022 – 2023 26 Company Number: 5787972

Notes forming part of the Financial Statements (continued) For the year ended 30 June 2023

16. Subsidiaries (continued)

PROFIT AND LOSS ACCOUNT

Year to
30 June 2022
£’000
4,191
Turnover
(1,067)
Costofsales
3,124
Gross profit
60
Interestreceived
3,184
(1,144)
Administration
(1,024)
Associationrecharge
1,016
Net result		 Year to
30 June 2023
£’000
5,135
(1,513)
3,622
33
3,655
(1,697)
(1,139)
819

BALANCE SHEET

CE SHEET
As at
30 June 2022
£’000
44
Fixed assets
5,516
Currentassets
(4,178)
Creditors:Amountsfallingduewithinoneyear
1,382
Total assets less current liabilities
(1,382)
Creditors: Amounts falling due after more than
one year
-
Net assets		 As at
30 June 2023
£’000
203
5,808
(4,845)
1,166
(1,166)
-

The turnover in HFMA Limited totalled £5,135,000 (2022 £4,191,000) for the year of which £106,000 (2022 £46,000) related to activities performed for HFMA which is removed on consolidation. Therefore, in the consolidated accounts turnover relating to HFMA Limited is shown as £5,029,000 (2022 £4,145,000).

b) HFMA COMMERCIAL SERVICES LIMITED (HCS LTD) COMPANY NUMBER 6384842

The principal activity of the company was providing consultancy services to the healthcare industry. There was no trading in this subsidiary in the year to 30 June 2023 or 30 June 2022. The Financial Statements of HCS Ltd for the year to 30 June 2023, as consolidated into the accounts of HFMA had £nil net assets (30 June 2022 £nil).

17. Statement of funds

Trading funds are the funds held in the subsidiary companies, all other funds are held by the Charity HFMA.

Unrestricted funds
General funds
Trading funds
Generalfund
Designated funds
Branch fund
Bursary fund
Consolidated		 at 1 July 2022
Surplus/
(Deficit)
Transfers Unrecognised
gains/(losses)
at 30 June 2023
£’000
£’000
£’000
£’000
£’000
-
819
(819)
-
-
3,580
(460)
819
33
3,972
626
19
(1)
5
649
38
-
1
-
39
4,244
378
-
38
4,660

The transfers between funds relate to the total Gift Aid to the Association Centre from the trading subsidiaries.

HFMA ANNUAL REPORT 2022 – 2023 27 Company Number: 5787972

Notes forming part of the Financial Statements (continued) For the year ended 30 June 2023

18. Analysis of net assets between funds

HFMA Group Analysis of net assets between funds as at 30 June 2023

Fixed and intangible assets
Cash at bank and in hand
Other current assets
Current liabilities
Liabilities due after more than 1
year		 General fund
Branch fund
Bursary
fund
Total funds
£’000
£’000
£’000
£’000
6,492
86
-
6,578
2,852
13
39
2,904
2,900
1,401
-
4,301
(7,098)
(851)
-
(7,949)
(1,174)
-
-
(1,174)
3,972
649
39
4,660

Analysis of net assets between funds as at 30 June 2022

Fixed and intangible assets
Cash at bank and in hand
Other current assets
Current liabilities
Liabilities due after more than 1
year		 General fund
Branch fund
Bursary
fund
Total funds
£’000
£’000
£’000
£’000
6,180
81
-
6,261
3,918
13
38
3,969
929
1,025
-
1,954
(6,053)
(493)
-
(6,546)
(1,394)
-
-
(1,394)
3,580
626
38
4,244

HFMA Company Analysis of net assets between funds as at 30 June 2023

Fixed and intangible assets
Cash at bank and in hand
Other current assets
Current liabilities
Liabilities due after more than 1 year		 General
fund
Branch fund
Bursary fund
Total funds
£’000
£’000
£’000
£’000
6,289
86
-
6,375
1,415
13
39
1,467
513
1,401
-
1,914
(4,237)
(851)
-
(5,088)
(8)
-
-
(8)
3,972
649
39
4,660

HFMA ANNUAL REPORT 2022 – 2023 28 Company Number: 5787972

Notes forming part of the Financial Statements (continued) For the year ended 30 June 2023

Analysis of net assets between funds as at 30 June 2022

Fixed and intangible assets
Cash at bank and in hand
Other current assets
Current liabilities
Liabilities due after more than 1 year		 General
fund
Branch fund
Bursary fund
Total funds
£’000
£’000
£’000
£’000
6,136
81
-
6,217
928
13
38
979
(280)
1,025
-
745
(3,192)
(493)
-
(3,685)
(12)
-
-
(12)
3,580
626
38
4,244

19. Capital commitments

At 30 June 2023, there were £71,000 (2022 £242,000) capital commitments for activities contracted for but not provided in the financial statements.

HFMA ANNUAL REPORT 2022 – 2023 29 Company Number: 5787972

Notes forming part of the Financial Statements (continued) For the year ended 30 June 2023

INDEPENDENT AUDITOR’S REPORT TO THE TRUSTEES AND MEMBERS OF HEALTHCARE FINANCIAL MANAGEMENT ASSOCIATION

Opinion

We have audited the financial statements of Healthcare Financial Management Association (the ‘parent charitable company’) and its subsidiary (the ‘group’) for the year ended 30 June 2023 which comprise Group and Parent Charitable Company Statement of Financial Activities, the Group and Parent Charitable Company Statements of Financial Position, the Group Cash Flow Statement and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

We have been appointed auditor under section 44(1)(c) of the Charities and Trustee Investment (Scotland) Act 2005, section 151 of the Charities Act 2011 and under the Companies Act 2006 and report in accordance with regulations made under those Acts.

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent charitable company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the

UK, including the FRC’s Ethical Standard and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the trustees’ use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group’s or parent charitable company’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the trustees with respect to going concern are described in the relevant sections of this report.

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor’s report thereon. The trustees are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

HFMA ANNUAL REPORT 2022 – 2023 30 Company Number: 5787972

INDEPENDENT AUDITOR’S REPORT (continued)

purposes of company law and included within the trustees’ annual report, for the financial year for which the financial statements are prepared is consistent with the financial statements; and

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and the parent charitable company and their environment obtained in the course of the audit, we have not identified material misstatements in the directors’ report or the strategic report, included within the trustees’ annual report.

We have nothing to report in respect of the following matters where the Companies Act 2006, the Charities Act 2011 and the Charities Accounts (Scotland) Regulations 2006 (as amended) require us to report to you if, in our opinion:

Responsibilities of trustees

As explained more fully in the statement of trustees’ responsibilities set out on page 8 the trustees (who are also the directors of the charitable company for the purposes of company law) are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view and for such internal control as the trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the trustees are responsible for assessing the group’s and parent charitable company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the trustees either intend to liquidate the group or parent charitable company or to

cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

The extent to which the audit was considered capable of detecting irregularities, including fraud

Irregularities are instances of non-compliance with laws and regulations. The objectives of our audit are to obtain sufficient appropriate audit evidence regarding compliance with laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements, to perform audit procedures to help identify instances of non-compliance with other laws and regulations that may have a material effect on the financial statements, and to respond appropriately to identified or suspected non-compliance with laws and regulations identified during the audit.

In relation to fraud, the objectives of our audit are to identify and assess the risk of material misstatement of the financial statements due to fraud, to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud through designing and implementing appropriate responses and to respond appropriately to fraud or suspected fraud identified during the audit.

However, it is the primary responsibility of management, with the oversight of those charged with governance, to ensure that the entity's operations are conducted in accordance with the provisions of laws and regulations and for the prevention and detection of fraud.

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud, the group audit engagement team:

HFMA ANNUAL REPORT 2022 – 2023 31 Company Number: 5787972

INDEPENDENT AUDITOR’S REPORT (continued)

charitable company operate in and how the group and parent charitable company are complying with the legal and regulatory frameworks;

As a result of these procedures we consider the most significant laws and regulations that have a direct impact on the financial statements are FRS 102, Charities SORP (FRS 102), Companies Act 2006, Charities Act 2011, Charities and Trustee Investment (Scotland) Act 2005, the parent charitable company’s governing document and tax legislation. We performed audit procedures to detect noncompliances which may have a material impact on the financial statements which included reviewing the financial statements including the Trustees’ Report, remaining alert to new or unusual transactions which may not be in accordance with the governing documents, inspecting correspondence with local tax authorities and evaluating advice received from external advisors.

The group audit engagement team identified the risk of management override of controls and the existence and valuation of certain revenue streams as the areas where the financial statements were most susceptible to material misstatement due to fraud. Audit procedures performed included but were not limited to testing manual journal entries and other adjustments, evaluating the business rationale in relation to significant, unusual transactions and transactions entered into outside the normal course of business, challenging judgments and estimates and performing substantive test of details over a sample of income transactions.

company’s trustees, as a body, in accordance with section 44(1)(c) of the Charities and Trustee Investment (Scotland) Act 2005 and regulation 10 of the Charities Accounts (Scotland) Regulations 2006 (as amended) and the Charities Act 2011. Our audit work has been undertaken so that we might state to the members and the charitable company’s trustees those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charitable company, its members as a body, and its trustees as a body, for our audit work, for this report, or for the opinions we have formed.

Kerry Gallagher

KERRY GALLAGHER (Senior Statutory Auditor) For and on behalf of RSM UK AUDIT LLP, Statutory Auditor

Chartered Accountants

Second Floor

1 The Square Temple Quay Bristol BS 1 6DG

Date 08/11/23

RSM UK AUDIT LLP is eligible to act as an auditor in terms of section 1212 of the Companies Act 2006

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at http://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

Use of our report

This report is made exclusively to the members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006, and to the charitable

HFMA ANNUAL REPORT 2022 – 2023 32 Company Number: 5787972